Legal Checkup

As a board member of a homeowners’ association (HOA), knowing where to get a loan can be confusing. Before your condominium or homeowner association decides to move forward with financing. They should contact legal counsel to assess whether the association has the authority to enter into a loan agreement. They should also consider getting an HOA advisor. An HOA advisor can help with navigating the loan process and obtaining the best interest rate.


The next step is to inform members of the intent to borrow funds. A public forum is the best place for this discussion. At this time, the board should provide a detailed loan proposal to its members. The board should have a written summary. The document should contain a few vital pieces of information ranging from the thought process around the decision to borrow, the proposed terms of the loan, and the repayment plan.

Professional Advice

When meeting with members about a condominium or homeowner association loan, the board should have an outside advisor present to answer questions. To avoid potential issues down the road, members should formally vote to approve the loan. This step is not just a best practice; it may be required in the condominium or HOA bylaws, especially if the loan repayment will necessitate an increase in dues.


It is a best practice to seek more than one loan proposal. Too often, boards focus solely on an interest rate without regard to loan structure and credit terms. Rarely are loan proposals identical so conducting a careful review is always a good idea.

Arch Capital Solutions acts as an advocate for your HOA. We have relationships with lenders who specialize in HOA loans.